Completing the latest Fair Insurance Code review is Insurance Council of New Zealand (ICNZ) Jane Brown’s number one career achievement so far.
Appointed the peak insurance body’s Legal Counsel in 2017, Brown says the review was ‘a long-running, at times stressful, piece of work’.
HARD WORK PAYS OFF
Calls for public submissions went out in late 2017, followed by a lengthy evaluation and drafting period.
‘My involvement through the processes of the review included incorporating public, stakeholder and ICNZ member submissions and liaising with the Code Compliance Committee and ICNZ Board working groups,’ Brown says.
‘I have done a lot of the redrafting of the Code itself and have also worked on materials to assist members in their understanding of the Code provisions.
‘I have also been lucky enough to be involved with the parts of the review which aren’t strictly within my purview, such as design of the Code and the plain language review.’
A PROUD MOMENT
Brown says she will also be involved in the implementation of the Code by providing ongoing assistance to members, collecting and collating Code reporting data and facilitating the work of the Code Compliance Committee, which will monitor and enforce compliance.
A key part of the implementation will also require maintaining relationships with the external dispute resolution schemes who interpret and apply the Code.
‘I’m immensely proud of where we’ve landed,’ says Brown.
‘It was also heartening to receive feedback from the Minister of Commerce and Consumer Affairs about the proactive approach ICNZ is taking on industry behaviour.
‘The 2016 version of the Code was a vast improvement on the previous version, and I feel this [latest] iteration has taken a leap forward yet again.’
IMPROVING CUSTOMER OUTCOMES
As well as stronger compliance obligations, Brown says the updated Code contains more customer-focussed provisions and improved accessibility with Te Reo Māori and New Zealand Sign Language translations.
It has also obtained the WriteMark Plain Language Standard.
‘Another key change is the introduction of a Fair Insurance Code logo which allows the Code to be more visible and acts as a quality mark for ICNZ members,’ she says.
Brown, who started her insurance career at a mutual liability pool, says she jumped at the chance to improve her legal and insurance experience through a role with the ICNZ.
‘We’re very fortunate at ICNZ to be given quite a lot of freedom to develop our roles and responsibilities,’ she enthuses.
‘ICNZ sets its industry strategy each year and staff then all work towards the agreed priorities.’
EDUCATION AND STANDARDS
As Legal Counsel, Brown’s remit comprises the Fair Insurance Code, various regulatory work, the Insurance Claims Register, as well as privacy, and travel, liability and cyber insurance through the standing committees she helps to facilitate.
She particularly enjoys the parts of her role that further public and stakeholder education and focus on improving service standards.
‘I hope that I can continue to expand this work in future,’ she says.
ENGAGING WITH BROKERS
In addition to her work with the Fair Insurance Code, Brown also co-hosts the New Zealand Insurance Law Association (NZILA) liability discussion group series, which aims to update insurance professionals, be it lawyers, brokers, or loss adjusters, on hot topics relating to liability insurance.
‘My standing committees have an increased focus on what we can do in terms of education and we are exploring how we might provide messaging around topics like health and safety and cybersecurity,’ she says.
‘This part of my work also involves increased engagement with brokers who play an integral role in both the education of insureds and providing quality service.’
UNDERSTANDING THE CODE
At the ANZIIF New Zealand Fair Insurance Code webinar, to be held 1 July, Brown plans to cover key themes arising during the Code’s review process, changes to the Code as well as important existing provisions insurers and brokers should be familiar with.
Brown hopes that attendees of the webinar will go away with a greater understanding and appreciation for the Code.
‘Hopefully they will understand our drivers behind having and promoting the Code and will be in a position where they also feel comfortable informing insureds about the existence of the Code and insurer obligations,’ she says.
‘The Code review took place during a period of intense insurer scrutiny both in New Zealand and Australia.
‘It has been flavoured by the Australian royal commission, the Financial Markets Association (FMA) and Reserve Band of New Zealand review of banks and life insurers, and government focus on the insurance sector via the Insurance Contract Law and Conduct of Financial Institutions reviews.
‘We have done what we can to incorporate aspects of the FMA’s Good Conduct Guide into the Code and to elevate the customer focus.
‘We feel that, thanks to the Code, ICNZ and its members were already leaders in this space, but there is always room for improvement which we are committed to leading.’
At the webinar, Brown will also explain the role of the Code Compliance Committee in more detail and how compliance with the Code is monitored.
She says the addition of a mandated role for the Code Compliance Committee and a definition for significant breach has afforded the Code more transparency around compliance than before.
‘It’s all well and good to have an industry code, but it also needs to have teeth for it to have real meaning,’ she says.
‘We want to give the public confidence that we are monitoring the behaviour of our members and compliance with the Code and that we will be taking action if things are not up to standard.’
Compliance obligations for general insurers stemming from the Code include reporting the total number of significant breaches and unresolved significant breaches to ICNZ on a quarterly basis.
BEYOND COMPLAINTS DATA
On an annual basis insurers are also required to submit complaint data, for example, the total number of complaints received during the year, the number of complaints referred to the insurer’s external dispute resolution scheme and the number of complaints decisions upheld against the insurer by the external dispute resolution scheme.
Bilateral agreements with the external dispute resolution schemes will allow ICNZ to verify the figures received from its members.
Brown adds that the introduction of the 2020 Code also comes with a new compliance obligation in the form of an annual attestation that goes above and beyond the previous focus on significant breach and complaints data.
‘The attestation must be signed off by a senior officer of the company, and concentrates on the wider obligations under the Code, with the first attestations due in 2021,’ she says.
‘If a member is found to have significantly breached the Code and brought the insurance industry into disrepute, they can be sanctioned by the ICNZ Board.’
Sanctions include reprimand, termination of membership, or a fine of up to $100,000. Any fine money goes towards public education on insurance.
Given the new Fair Insurance Code comes at the same time as the new FMA regulatory regime and Code of Conduct for financial advice, insurers and brokers will undoubtedly have increased compliance obligations given all the moving parts around conduct and culture.
But Brown says the Fair Insurance Code isn’t intended to be onerous.
She also argues that there has been recognition that the financial industry has more work to do around the treatment of customers.
‘All parties are committed to improving industry standards so there is no doubt that they will work hard to meet legislative requirements,’ she says.
A CONSISTENT DIRECTION
‘I think the Fair Insurance Code 2020, the Code of Professional Conduct for Financial Advice Services and the Financial Markets (Conduct of Institutions) Amendment Bill are all moving in the same direction at a principled level,’ she says.
‘The Fair Insurance Code seems consistent with the direction these other pieces of work are moving in, as well as with the expectations of other industry bodies such as the Financial Services Council and the Insurance Brokers Association.
‘We’re all putting processes in place to ensure that behaviour improves, and customers have the best experience possible throughout the life cycle of their insurance cover.’
Are you sure you want to delete your comment?
This cannot be undone.